Craneware bullish on outlook as first-half profits soar

Edinburgh-based medical billing software developer said recent US Presidential election has left it well positioned to “deliver against a market opportunity that is now considerably larger than at any other point in our history”

Medical billing software developer Craneware is bullish in its outlook believing the recent US Presidential election has created the biggest market opportunity in its history.

The Edinburgh-based company, which sells audit software tools to the US healthcare market, notes in a first-half update: “Against a backdrop of the recent US Presidential election, the overriding consensus for the need to drive value in US Healthcare has been re-affirmed.”

Craneware, which reports in US dollars, said revenue for the six months to December 31 rose 16 per cent to $26.8 million (£22 million) and pre-tax profits rose 23 per cent to $7.5 million (£6.1 million).

US President Donald Trump signalled his intention in January to repeal and replace the Affordable Care Act by introducing new free-market healthcare reforms, which Craneware describes as “supportive market drivers”.

Craneware said it is now well positioned to “deliver against a market opportunity that is now considerably larger than at any other point in our history”.

Adding: “There is ongoing support for the move to value-based care and increasing consumerism.

“Our Value Cycle software suite will continue to help US Healthcare providers meet the challenges they will face as they navigate the ongoing re-imbursement model changes.”

Craneware said it made “significant strides forward” on expanding its product suite in the first half.

The group notes the average length of new hospital contracts was consistent with historical norms over the past five years with “comparable level of sales between new customers and existing customers”.

Craneware said following the UK's vote to leave the EU last year it decided to hedge its sterling requirements for the financial year, covering around 25 per cent of its total cost base, largely on UK employees and purchases.

The board is proposing an interim dividend of 8.7p (10.7 cents) per ordinary share, up from 7.5p last year.

Chief executive Keith Neilson said: “The first half of the year has been a period of successful execution against our stated growth strategy, delivering accelerated growth at both the revenue and adjusted EBITDA level.

"During the period we have taken significant strides forward in terms of delivering our expanded product suite, educating our market place and also further investing in our people.

"These ongoing achievements mean we are well positioned to deliver against a market opportunity that is now considerably larger than at any other point in our history.”